By unwise decision, Netflix’s stock price has been dropped dramatically. That unwise decision were 1) to increase the price of subscription 2) to split business models into two – one is streaming and another DVD rental. Now customers that enjoyed Netflix products & service very much showed their angry emotion to Netflix and will go to other competitors.
Now Netflix’s management tried to explain why they had to increase the price and to cancel the split decision. But it’s too late for royal customers to return back to them. Maybe, Netflix’s dominance in the steaming & DVD rental market will be over and so many other competitors including Amazon & Google will share the market in reasonably proportional manner.
We should see the very important lesson from this case; i.e. 1) there is permanent royal customers in the market without constantly providing benefits to customers 2) in any decisions that the management will make, No. 1 priority should be customers’ reaction instead of thinking of their internal situation 3) moving fast is a kind of “good” but too fast would be over the limit like CEO of Netflix has mentioned.
I liked this kind of things to happen in the market. Then, the market will move forward in positive direction. But without competition, it will not happen. That’s why anti-trust law & enforcement should be important and alive in any places. I saw some of products & service are in monopoly & oligopoly. It should be remedied properly in the near future. Constant renovation will bring good stuffs for us and it should come from reasonable competition in the market.
http://money.cnn.com/2011/10/24/technology/netflix_earnings/index.htm?iid=SF_T_LN
Tags: netflix, streaming product
